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 “Consumers in Illinois will continue to have affordable coverage
options in 2017. Last year, the average monthly premium for people
with HealthCare.gov coverage getting tax credits increased just $4
from $102 to $106 per month, despite headlines suggesting double
digit increases. People in Illinois understand how the Marketplace
works, and they know that they can shop around and find coverage
that fits their needs and budget. In fact, last year more than 53
percent of them did exactly that by switching plans to save money.
In addition, the vast majority of consumers in Illinois qualify for
tax credits that reduce the cost of coverage below the sticker
price. Today’s announcement is just the beginning of the rates
process, and consumers will have the final word when they vote with
their feet during Open Enrollment.”
Background
Proposed rates aren’t what consumers pay.
While today’s filings show an average rate increase in Illinois,
a report from the U.S. Department of Health and Human Services
demonstrates that proposed premium changes from preliminary rate
filings do not capture what Marketplace consumers actually pay. Last
year, the average monthly premium for people with HealthCare.gov
coverage getting tax credits increased just $4 from $102 to $106 per
month, despite headlines suggesting double digit increases.
Most people receive tax credits and can buy a plan for less than
$75 per month.
75% of Marketplace consumers in Illinois receive tax credits, which
are designed to protect consumers from premium increases and help
make coverage affordable.
Tax credits increase if the cost of the second lowest-cost silver,
or benchmark, plan goes up. So if all premiums in a market go up by
similar amounts, 75% of Marketplace consumers in that market will
not necessarily pay more because their tax credits will go up to
compensate. Average rate increases reported with the preliminary
rate filings do not account for tax credits.
For 2016 coverage, 53% of customers in Illinois had the option of
selecting a plan with a premium of $75 or less per month after tax
credits.
Shopping: The ACA Marketplace helps consumers shop around for the
best deal.
Prior to the ACA, it was nearly impossible for consumers to compare
plans and shop around easily – and many Americans went uninsured
because they couldn’t afford insurance or had pre-existing
conditions. Those who did have insurance in the individual market
were often trapped in the plan they had, since people with even
small health problems could be denied coverage or charged an
exorbitant price if they tried to switch plans or issuers.
Today, Marketplace consumers in Illinois can purchase any available
plan regardless of health conditions, and tools such as the doctor
lookup and out-of-pocket cost calculator help them find the plan
that meets their needs. Last year, 53% of returning Marketplace
consumers in Illinois switched plans. They saved an average of $636
annually.
Based on an examination of preliminary 2017 rate filings for nine
states that released rates earlier this year, Avalere found that the
average rate increase for lowest and second-lowest cost silver plans
was 7-8%, about half the overall average rate increase in these
states. That difference highlights how consumers can benefit from
shopping around.
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A major new issuer, Cigna, has indicated it will begin offering
plans in the Chicago area for 2017, which will further bolster
choice and competition in the Illinois Marketplace. Prior to
the Affordable Care Act, plans were typically inferior and
excluded services like maternity care, or even routine services like
prescription drugs. Plans also often charged a higher premium, or
denied coverage altogether, to consumers due to a pre-existing
condition. Now, all consumers have the option to purchase quality,
affordable coverage.
This is a big deal for as many as 5,636,000 people in Illinois with
a pre-existing condition.
Preliminary rates aren’t final rates.
Preliminary rates often change significantly before being
finalized. In particular, they are subject to rate review, which led
to $1.5 billion in savings for consumers in 2015. Last year, final
rates in some states were below proposed rates.
Health insurance is clearly something people in Illinois like,
want, and need:
388,179 people signed up for 2016 coverage through the
Marketplace.
Since major provisions of the Affordable Care Act went into effect,
Illinois’ uninsured rate fell from 14.2 percent in 2013 to 7.9
percent in 2015 for non-elderly residents, according to new data
released recently.
Both Marketplace and non-Marketplace consumers continue to
benefit from the low health care cost growth of recent years.
Marketplace rates remain well below expectations when the law was
passed. Marketplace rates for 2014 came in about 15% below
Congressional Budget Office (CBO) projections in 2010.
Better-than-expected Marketplace premiums are due in large part to
lower-than-expected economy-wide health care cost growth and other
efficiencies.
For the half of Americans who obtain health insurance through an
employer, premiums for family coverage grew by an average of 5% per
year from 2010 to 2015 – compared with about 8% per year from 2000
to 2010. Premiums grew at an even slower 4.2% rate in 2015. If
premium growth since 2010 had matched the average growth rate over
the prior ten years, the average family premium would have been
almost $2,600 higher in 2015.
[Monique S. Fontenot, Office of the
Assistant Secretary for Public Affairs, Department of Health and
Human Services]
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